The establishment of sexual identity in the germline is critical for the sex-specific development of germline stem cells and the production of sperm vs. eggs. Thus, it is an essential aspect of animal sexual reproduction and human fertility. Germ cells depend on signals from the somatic gonad to determine their sex, but in organisms such as flies, mice and man, the sex chromosome genotype of the germ cells is also important for germline sexual development. Ultimately, germline sexual identity must result in a sex-specific program of gene expression in the germ cells. How somatic signals and germ cell autonomous factors combine to regulate sex-specific gene expression in the germline is a central question for germline sex determination about which little is known in any organism. In Drosophila, extrinsic signals from both the male soma and the female soma regulate germline sexual identity. We have shown that the male signal acts through the JAK/STAT pathway, but the nature of the female signal remains unknown. Intrinsically, the germline sex chromosome genotype activates expression of the germline sex determination gene Sex lethal (Sxl) in females. How Sxl becomes activated in the female germline, and how Sxl regulates female germ cell identity are also unknown. Lastly, these extrinsic and intrinsic mechanisms must ultimately give rise to a sex-specific pattern of gene expression. We have identified Plant homeodomain finger protein 7 (PHF7) as a critical factor in regulating male germline identity that acts as a reader of epigenetic information by recognizing specific modified forms of histone H3. However, we do not yet know how PHF7 functions to regulate male germline gene expression. In this proposal, we will take an integrated approach to investigate how extrinsic signals from the soma combine with germline intrinsic cues to initiate germline sex determination and generate a sex-specific pattern of germline gene expression. This work will provide a comprehensive model for how sexual identity is established and used to influence important aspects of germline development, such as the sex-specific formation of germline stem cells. This model can be used as a framework for continued studies of germline sex determination in Drosophila and other animal species, including humans.